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Best short-term saving option

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Best short-term saving option

edited 30 November -1 at 1:00AM in Savings & Investments
3 replies 635 views
peteskiespeteskies Forumite
23 posts
edited 30 November -1 at 1:00AM in Savings & Investments
Hi there

I plan on buying a house later on in the year (I'm currently waiting to see what happens with the market) I have £20,000 of savings and am accumulating approximately £4,000 - £5,000 a month.

What is the best option for putting this away somewhere for 6 - 8 months?

I currently have a cash ISA full up for the year. Would it be worthwhile putting £4000 in a S&S ISA, even though it will probably not be over a long term?

If it is possible I would prefer to invest with the possibility of earning more, rather than have a fixed return - I accept the risk that I could make a loss this way.

Your suggestions welcome!

Peter

Replies

  • hi peteskies,

    Not worth going into an S&S ISA for 6-8 months, you could hit a really bad patch and end up with less than you put in on that timescale and with the current high volatility.

    I know you say not fixed rate, but Icesave's 6 month fixed term bond still looks attractive @ 6.76%. But snap it up now before the rates drop - it might not be around after the expected Bank of England base rate cut in a couple of weeks.

    You could put your £20k in that, then choose something more accessible (ICICI, Icesave) for the money you save subsequently.
    "Success is the ability to go from failure to failure without losing your enthusiasm" (Sir Winston Churchill)
  • PrimrosePrimrose Forumite
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    I'd say definitely not a stocks & shares ISA for any term under five years and certainly not for a few months. For so short a savings period I'd keep it very simple and opt for something like ICESAVE. If you can fix for six months, ICESAVE also offer a six month fixed rate bond and if you can save £4000 - £5000 every month there's nothing to stop you taking out another single fixed rate bond for this amount every month until around May or June, which would give you maturity by the end of the end. When April comes I'd also use up your next tax year's £3600 Cash ISA allowance
  • Thanks to both of you, I have investigated further and am going to go ahead with your suggestions. :D
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